Correlation Between National Beverage and Ameren Illinois
Can any of the company-specific risk be diversified away by investing in both National Beverage and Ameren Illinois at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining National Beverage and Ameren Illinois into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Beverage Corp and Ameren Illinois, you can compare the effects of market volatilities on National Beverage and Ameren Illinois and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in National Beverage with a short position of Ameren Illinois. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Beverage and Ameren Illinois.
Diversification Opportunities for National Beverage and Ameren Illinois
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and Ameren is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding National Beverage Corp and Ameren Illinois in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameren Illinois and National Beverage is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on National Beverage Corp are associated (or correlated) with Ameren Illinois. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameren Illinois has no effect on the direction of National Beverage i.e., National Beverage and Ameren Illinois go up and down completely randomly.
Pair Corralation between National Beverage and Ameren Illinois
Given the investment horizon of 90 days National Beverage Corp is expected to under-perform the Ameren Illinois. But the stock apears to be less risky and, when comparing its historical volatility, National Beverage Corp is 1.63 times less risky than Ameren Illinois. The stock trades about -0.03 of its potential returns per unit of risk. The Ameren Illinois is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 6,386 in Ameren Illinois on November 3, 2024 and sell it today you would earn a total of 164.00 from holding Ameren Illinois or generate 2.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Beverage Corp vs. Ameren Illinois
Performance |
| Timeline |
| National Beverage Corp |
| Ameren Illinois |
National Beverage and Ameren Illinois Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Beverage and Ameren Illinois
The main advantage of trading using opposite National Beverage and Ameren Illinois positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Beverage position performs unexpectedly, Ameren Illinois can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ameren Illinois will offset losses from the drop in Ameren Illinois' long position.| National Beverage vs. Celsius Holdings | National Beverage vs. Monster Beverage Corp | National Beverage vs. Coca Cola Femsa SAB | National Beverage vs. Keurig Dr Pepper |
| Ameren Illinois vs. Netflix | Ameren Illinois vs. PowerFleet, | Ameren Illinois vs. Protara Therapeutics | Ameren Illinois vs. Alphabet Inc Class C |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |